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Banquet Speech

Theodore W. Schultz' speech at the Nobel
Banquet, December 10, 1979

Your Majesties, Your Royal Highnesses,
Ladies and Gentlemen,

Your Royal Academy of Sciences expressed a deep concern about the
economic problems and the welfare of poor people throughout the
world in awarding the Nobel Prize in Economics this year. It is a
noble concern worthy of the best talent not only in economics but
also in other branches of knowledge.

Permit me, however, to be less serious
about economists for a moment.

I have been asked: What do economists do?
My reply is: When economists face disagreements, they appeal to a
long-established, basic Law of Talk, which is, "The more
intelligent people are, the more certain they are to disagree on
matters of social principle and policy, and the more acute will
be the disagreement." Herein lies the proof that economists are
intelligent!

Economists, however, do not do what needs
to be done to make friends, they neglect history to the
consternation of historians. They give too little attention to
the cultural and social values to please the humanities. Their
mathematics does not impress the mathematicians. Scientists do
not take kindly to the application of costs and benefits to
science. Governments are ever wary of being friendly with
academic economists. The only real friends economists have are
impersonal adverse events: inflation, unemployment, and hard
times.

But this is not the whole truth. Scientists
made it possible to increase the resources of society. Humanists,
historians and social scientists clarify human values. Economists
analyze the interplay between human preferences and scarce
resources.

Folklore notwithstanding, economists do
count their words as poets do, but for a different reason. It is
not beauty that economists seek; their aim is to save
time. I know that you also value your time highly.